Introduction

The India steel industry is one of the major industries in India and the Indian government
plays a very important role in the development of the steel industry in India.

The India steel industry is experiencing a slow but steady growth. The
steel industry in India has huge scopes in the future with massive scale
of infrastructural development happening all across the country. The
India steel industry caters to many other industrial sectors such as
construction industry, mining industry, transportation industry,
automobile industry, engineering industry, chemical industry, etc.

 Others major steel producers

12. Tata iron and steel corporation ltd (TISCO)
13. Essar steel
14. Jindal Vijaynagar steels ltd
15. Ispat industries ltd
16. Jindal strips ltd
17. Mahindra Ugine steel company ltd
18. JISCO
19. Lloyds steel industries ltd
20. Electro steel castings ltd
21. Saw Pipes
22. Uttam steels ltd
23. Mukand ltd
24. Tata SSL ltd
25. Usha Ispat ltd
26. Kalyani steel ltd

Strengths of Indian Steel Industry

 Low labour wage rates

 Abundance of quality manpower
 Mature production base
 Positive stimuli from construction industry
 Booming automobile industry

Outlook

The outlook for Indian steel industry is very bright. India's lower wages
and favourable energy prices will continue to promise substantial cost
advantages compared to production facilities in (Western) Europe or the
US. It is also expected that steel industry will undergo a process of
consolidation since industry players are engaged in an unfettered rush for scale. This is
evident from the recent acquisition of Corus by Tata.
The deployment of modern production systems is also enabling Indian

steel companies to improve the quality of their steel products and thus
enhance their export prospects

ANALYSIS (Rupees in Crores)

CA= 5707.05+4198.26=9905.31

From CA Advances given to Public Bodies of Rs.379.78Crores is eliminated

FA= 14482.22

SALES = 26843.73

Sales are gross sales and the excise duty is not deducted from it

RATIOS.

*CA/FA=0.684

The ratio is low since the Capital WIP is very high and company is investing funds to buy
latest plant & machinery. (Reasonable).

*SALES/CA = 2.71

The ratio is reasonable as the turnover is very high.

*Net Working Capital = 1311.04

The net working Capital has reduced tremendously (i.e. reduction of 28882.62 Crores)
because of new acquisitions and investment in equity and mutual funds.

*Credit Period enjoyed and allowed by the company is quite reasonable i.e. 9 days is
debtor’s conversion period
*The company is not using short term loans to meet its long term investment but instead
issues convertible warrants, debentures, equity etc..

*The operating Cost of the company has increased both gross & net which can be seen by
significant drop in profit as a percentage of sales.

*The company is Highly leveraged which can be seen from the loans figure which has
considerably gone up because of private placement, term loan and other modes of
finances.

* The Management policy is Very Aggressive as can be seen by Huge acquisitions

globally and even locally and borrowing huge sums for such investments.

* The Company has got many new projects and expansion plans of its various units by
increasing their capacity and acquisition of various foreign steel companies and are
entering new markets in India by joint ventures with local players.